HUD Comprehensive Valuation Package - Forms 92564-VC and 92564-HS On September 10, 1999 The Department of Housing and Urban Development (HUD) began requiring appraisers to complete the newly revised four page Valuation Condition (VC) checklist (form HUD-92564-VC). This form does not represent new requirements for FHA appraisals. The revised form incorporates FHA requirements existing prior to September 10, 1999 and clarifies items listed on the previous VC checklist.
Similar to the previous VC check sheet, FHA has emphasized that the appraiser complete the revised VC sheet by simply observing the condition of the property and its key components and systems. In this respect, nothing new is being required by either the forms or the governing Handbook. FHA is not requiring the appraiser to make a judgment about observed conditions which that appraiser does not feel qualified to make.
FHA appraisals are distinguished from conventional appraisals in that the property is appraised "As Repaired" rather than "As Is". In order to make this distinction, the appraiser is required to have an intimate and up-to-date knowledge of the FHA Handbook 4150.2, Valuation Analysis for Home Mortgage Insurance. It is this knowledge that enables the appraiser to complete the VC form, and to reach an "as repaired" value. It is also this knowledge that appraisers eventually will be tested on by HUD in order to be listed on the FHA Appraiser Roster. Appraisers being added to the Roster since July 1, 1999 have successfully passed the examination. Appraisers already on the Roster before July 1 have until February 1, 2000 to pass the examination. Until this testing is completed, FHA will rely on an appraiser’s previous certification to and understanding of the FHA requirements which they made when originally applying for Roster status. As a result, appraisers listed on the FHA Roster of Appraisers will be considered to be competent to perform an FHA appraisal including the VC and Homebuyers Summary forms without having passed the test until February 1, 2000 .
FHA requires the homebuyer to sign two separate documents acknowledging the fact that an FHA appraisal is not a home inspection and that any conditions noted on the VC sheet are based on observations. The VC sheet is based on "readily observable conditions" rather than judgments by the appraiser. As stated in HUD’s September 10, 1999 Mortgagee Letter 99-29, "Appraisers who have passed state licensing exams and are familiar with the requirements of Uniform Standards of Professional Appraisal Practice (USPAP) will be able to review the instructions set forth in the Handbook and to accurately complete the Valuation Condition Sheet and Homebuyers Summary forms. The instructions are clear, concise, self-explanatory, and do not require an appraiser to perform work outside the scope of his or her expertise as defined by USPAP". |
